AB AMBER GRID RULES FOR ACCESS TO THE NATURAL GAS TRANSMISSION SYSTEM

Transcription

1 TRANSMISSION SYSTEM OPERATOR AB AMBER GRID AB AMBER GRID RULES FOR ACCESS TO THE NATURAL GAS TRANSMISSION SYSTEM Version 3.0 Vilnius, 2015

2 TABLE OF CONTENTS 1. GENERAL PROVISIONS DEFINITIONS AND ABBREVIATIONS RIGHTS AND OBLIGATIONS OF THE TSO AND SYSTEM USERS COOPERATION BETWEEN THE TSO AND OTHER GAS SYSTEM OPERATORS TRANSMISSION SYSTEM TRANSMISSION CONTRACT AND THE PROCEDURE FOR ITS CONCLUSION CAPACITY ALLOCATION SECONDARY CAPACITY MARKET TRANSMISSION NETWORK CONGESTION MANAGEMENT PROCEDURE FOR NOMINATION SUBMISSION AND APPROVAL ALLOCATION OF GAS QUANTITIES DETERMINATION OF CONSUMPTION CAPACITIES AT THE INTERNAL EXIT POINT DETERMINATION AND APPLICATION OF TRANSMISSION TARIFFS PROCEDURE OF PAYMENT FOR SERVICES SECURING CONTRACTUAL OBLIGATIONS FULFILMENT METERING OF GAS GAS QUALITY CASES AND PROCEDURE OF TRANSMISSION RESTRICTION OR TERMINATION DISPUTE RESOLUTION FORCE MAJEURE CONFIDENTIALITY INFORMATION FINAL PROVISIONS APPENDICES Appendix 1: Application for the execution of a transmission service contract Appendix 2: Natural gas transmission service contract

3 1. GENERAL PROVISIONS 1.1. AB Amber Grid Rules for Access to the Natural Gas Transmission System (hereinafter - the Access Rules) are prepared in accordance with Directive 2009/73/EC of the European Parliament and of the Council of 13 July 2009 concerning common rules for the internal market in natural gas and repealing Directive 2003/55/EC (OJ 2009 L 211, p. 94), Regulation (EC) No 715/2009 of the European Parliament and of the Council of 13 July 2009 on conditions for access to the natural gas transmission networks and repealing Regulation (EC) No 1775/2005 (OJ 2009, L 211, p. 36), Commission Regulation (EU) No 312/2014 of 26 March 2014 establishing a Network Code on Gas Balancing of Transmission Networks, the obligation for the Transmission System Operators to develop the Access Rules for the System Users as set out in paragraph 3 of Article 49 of the Law on Natural Gas of the Republic of Lithuania (Official Gazette, 2000, No ; 2007, No ; 2011, No ), requirements for the Rules for the Use of the Natural Gas Transmission System and the Rules for the Use of the Natural Gas Distribution System approved by Resolution No O3-178 of the National Commission for Energy Control and Prices of 5 July 2012 (Official Gazette, 2012, No ), and other legislation regulating the natural gas sector of the Republic of Lithuania The Access Rules establish the procedure and conditions for the use of the transmission system owned by the Transmission System Operator AB Amber Grid (hereinafter - the TSO), the procedure and conditions for the exchange of information between the TSO and the transmission System Users (hereinafter - the System Users), guidelines for the cooperation between the TSO and distribution system operators, rights, duties and responsibilities of the TSO and the System Users The Access Rules shall apply to System Users, the owners of the consumers systems connected directly to the TSO transmission system, operators of distribution and other gas systems connected to the transmission system as far as it is related to the provisions for the cooperation and information exchange laid down in the cooperation agreements between the TSO and these operators The Access Rules are intended to ensure that the System Users would be entitled to use the TSO transmission system on objective, fair, equal, and non-discriminatory terms between the System Users, and that the natural gas transmission services provided by the TSO would be transparent and all the conditions for the efficient use of the transmission system capacities would be provided The TSO, all System Users, as well as individuals who in the procedure prescribed by law and the Access Rules are going to become the System Users of the TSO system must comply with the provisions of the Access Rules. Therefore, the Access Rules form an integral part of the transmission contracts and are subject to the full extent The Access Rules have been prepared in accordance with the principles of transparency and publicity, non-discrimination of the System Users, fairness, promoting competitiveness, safety and reliability, clarity, specificity and precision, and technical and economic efficiency. 3

4 1.7. The transmission system balancing shall be carried out in accordance with the procedure set out in the AB Amber Grid Rules for Natural Gas Transmission System Balancing (hereinafter the Balancing Rules) The TSO shall prepare a separate procedure for the calculation of technical capacity. 4

5 2. DEFINITIONS AND ABBREVIATIONS 2.1. Definitions used in the Access Rules: The secondary capacity market (hereinafter - the secondary market) means a market where the System Users, through mediation of the TSO, trade with each other in capacities by transferring the rights (or part thereof) to use capacities of a given period at the certain entry or exit point under a bilateral contract for the purchase and sale of capacities. Reporting period means one month of gas. Cooperation Contract means a contract concluded between the TSO and other gas system operator in order to increase the efficiency of transmission and other services at the point of system interconnection, to facilitate commercial and technical cooperation between the operators. Business Day means the day from Monday to Friday, excluding public holidays and rest days of the Republic of Lithuania. Gas Year (hereinafter - the year) means a period beginning on 1 January, at 7:00 am of each year, and ending on 1 January, at 7:00 am of the following year. Gas Nomination (hereinafter - the nomination) means a prior notice of the System User to the Transmission System Operator on the actual gas flow, which the System User wishes to inject to or off-take from the system. Gas Matching means the equalization of gas quantities specified in gas nominations of the System User who receives gas at and the System User that delivers gas to the interconnection point of the gas transmission systems. Gas Year (hereinafter - the year) means a period beginning on 1 January, at 7:00 am of each year, and ending on 1 January, at 7:00 am of the following year. Gas Month (hereinafter - the month) means a period beginning on the first day, at 7:00 am of each calendar month and ending on the first day, at 7:00 am of the next calendar month. Gas Day (hereinafter - the day) means a period beginning each day at 7:00 am and ending the next day at 7:00 am (from 5:00 am UTC to 5:00 am UTC). Electronic Transmission Service Booking and Administration System (hereinafter the Electronic Transmission Service System or ETSS) means an online system developed and administered by the TSO where the TSO and System Users exchange information on booking and allocation of capacities in the primary and secondary market, transfer and refusal of capacities, submission of gas applications, and allocation, balancing and other transmission services, and other relevant information.. Energy Identification Code (EIC) (hereinafter the Identification Code) means the identification code assigned to the System User based on the Energy Identification Code (EIC) system. Allocation of Actual Gas Quantities (hereinafter the allocation) means natural gas quantities allocated to the System User by the Transmission System Operator actually injected at a certain entry point and (or) actually ejected at an exit point, expressed in kilowatt-hours, and (or) cubic meters. 5

6 Physical Congestion means a situation where the level of capacity utilization at a given time exceeds technical capacity of the transmission system. Final Allocation means the sum of gas quantities finally allocated to the System User for the balancing period. Natural Gas Read Metering Point (hereinafter the read metering point) means a place where natural gas measuring devices are installed for metering of the amount of gas consumed in a particular object of the System User. Funds of natural gas supply security component in addition to the natural gas transmission price (hereinafter - the security component funds) means the funds payable by the transmission System Users to compensate for all fixed operating costs of the LNG terminal, its infrastructure and interconnector thereof required to ensure and compensate for the operation of the LNG terminal. Natural gas consumption capacities (hereinafter consumption capacities) means the maximum daily quantity of natural gas required by a natural gas system user, which is necessary to ensure their maximum needs for natural gas consumption at each natural gas delivery location Long-Term Services means services provided by the Transmission System Operator offered for a period of one year or longer. Open Season means a procedure that is used to identify the demands for the newly created capacity and allocate the long-term capacity. Exit Capacity means the capacity of the transmission system at the appropriate exit point. Exit Point means a location where the gas transmission ends and gas is supplied to the adjacent transmission system, distribution system or to the Users system directly connected to the transmission system. If the distribution system is connected to the transmission system in several points of the transmission system, then all connection points shall be considered as a single connection point. Gas Off-Take means the quantity of gas that has been off-taken or intend to be off-taken from the transmission system at the exit point. Entry Capacity means the capacity of the transmission system at the corresponding entry point. Entry Point means a place where gas is delivered to the transmission system from the adjacent transmission system or the LNG terminal, and where the transmission of gas through the natural gas transmission system begins. Gas Input means the quantity of gas, which has been injected or intended to be injected to the transmission system at the entry point. Daily Read Metering Points mean gas metering points where remote (telemetry) data transmission metering devices are installed, and where gas quantities are recorded at least every day. The Maximum Hourly Gas Quantity (hereinafter - MHQ) has the meaning as defined in paragraph

7 The Lesser Rule Principle means the principle when the System User that delivers and receives gas at the interconnection point to the transmission system wishes to inject or off-take a different amount of gas, the TSO reduces the value of the greater gas nomination to a value of the lower gas nomination. Use it or Lose it/ UIOLI Mechanism means a procedure during which the booked, but unused transmission capacities are re-allocated. Non-Daily Read Metering Points means metering points where the quantity of gas is recorded less than every day. Unused Capacity means firm capacity, which the System User has acquired under the transmission contract, but which the System User has not yet nominated before the deadline specified in the contract. Firm Capacity means gas transmission capacity the uninterruptibility of which the Transmission System Operator guarantees under the contract. Capacity Allocation Mechanism means a system of measures selected by the TSO allowing System Users to allocate transmission capacities in a cost-effective, efficient and optimal manner. Capacity Booking means a procedure for online booking of transmission capacity when the System User wishing to book capacity is required to log in to the TSO online system (ETSS) by using an individual identification code and password given to him. Manual Capacity Booking means the procedure for transmission capacity booking when the System User, according to the booking form provided on the TSO website, sends the capacity booking by fax or regular mail, or , which must be registered on the TSO online system (ETSS), and all capacity bookings sent from this , shall be binding to the System User. Additional Capacity means firm capacity exceeding technical capacities of entry or exit point in the event of congestion management, or in the event of submission of nominations capacity in excess of the System User s booked capacity. Re-Nomination means a subsequent notification on the revised nomination. Re-Nomination Cycle means a process carried out by the Transmission System Operator seeking to timely submit to the System User a confirmation notice, who timely sent the renomination. Confirmation Notice means a notice submitted by the Transmission System Operator to the System User notifying on the confirmed quantity of gas to the System User for a specific gas day. Confirmed Quantity means the gas quantity to be transported to the System User for a specific gas day confirmed by the Transmission System Operator. Transmission Service Contract (hereinafter the Transmission Contract) means the contract concluded between the Transmission System Operator and the System User, which entitles the System User to use the transmission system and ensures the performance of the transmission service to the System Users. 7

8 Transmission System Capacity (hereinafter capacity) means the largest natural gas flow in cubic meters per time unit or in energy unit per time unit, which the System User shall be entitled to use in accordance with the provisions of the gas transmission contract. Congestion Management means the capacity management as a whole in order to optimize and maximize the use of technical capacity and timely detect the future congestion areas. Interruptible Capacity means capacity, which may be interrupted by the Transmission System Operator under the conditions laid down in the Access Rules. Interruptible Services means services offered by the Transmission System Operator based on interruptible capacity. Oversubscription and Buy-back Mechanism means a mechanism applied by the TSO when the TSO, having determined the quantities of potentially unused allocated capacity at a particular point of the transmission system, offers to the market additional capacity exceeding technical capacities, and in situations where the TSO cannot meet the System Users' needs of capacity in excess of technical capacity, the booked amount of capacity in excess of technical capacity the TSO seeks to purchase in the secondary market. First Come-First Served Principle means the capacity allocation method when capacity is allocated primarily to the System Users who have applied for capacity booking at the earliest. Primary Capacity Market (hereinafter the primary market) means a market of capacity directly sold by the Transmission System Operator. Initial Allocation means the sum of gas quantities preliminary allocated to the System User for the balancing period. Receipt Location means entry points to the transmission system where the System User physically delivers gas to the TSO-owned transmission system. Delivery Location means exit points from the transmission system where the transmission of gas ends and the TSO physically supplies gas to the System User to the systems of the adjacent natural gas operators or to the User's system directly connected to the transmission system. Pro-rata Principle means the procedure for allocation of quantities at gas entry and exit points according to which gas delivered to the System Users is allocated in proportion to the actual measured quantities of gas or nominations submitted; as well it means the principle of allocation of transmission capacity when the available transmission capacity is allocated in proportion to the capacity booked. System User means a person who has concluded an contract with the Transmission System Operator and supplies natural gas to the transmission system, or gas is supplied to him from the transmission system. Standard Capacity Product means a certain amount of capacity at the entry or exit point within a specified period of time (year, quarter, month, day or within-day). Interconnection Point means a physical or virtual point connecting the adjacent inject and eject systems, or the inject or eject system with an interconnector if capacity booking procedures are applied to System Users at this interconnection point; or an interconnection point of the transmission system to the neighboring transmission systems, or any other gas system. 8

9 Counterparty means a natural or legal person making use of an adjacent transmission system of a foreign state or of liquefied natural gas terminal facilities, supplying natural gas to the System User at the entry and exit points of the transmission system, or the System User delivers gas to him. Contractual Congestion means a situation where the contractual level of demand for firm capacity exceeds technical capacity. Technical Capacity means the maximum firm capacity that the Transmission System Operator can offer to the System Users considering the integrity of the system and the operational requirements of the transmission network. Operational Balancing Account is an account administered by the two adjacent Transmission System Operators or the TSO and the operator of the LNG terminal for recording the differences in gas volumes transmitted at the interconnection point to allocate gas amounts to the System Users in accordance with the amount of gas confirmed in nominations. Operational Balancing Contract means a contract concluded between two adjacent Transmission System Operators for the organization of technical balancing. Short-Term Services means services offered by the Transmission System Operator provided less than one year. Available Capacity means part of technical capacity that has not yet booked under the Transmission Contract. Internal exit point means the point of connection of the transmission system with gas distribution systems and the systems of Lithuanian consumers, which are directly connected to the transmission system. Gross Calorific Value of Natural Gas (hereinafter gross calorific value) means the amount of heat (energy) received as a result of complete combustion, under constant pressure, of one cubic metre of gas in air, when all products generated during combustion return to the original set temperature of the reagents and are in a gaseous state, except for the water that formed during combustion. The amount of heat shall also include the heat produced in the course of condensation of the water vapour contained in the products of combustion. Virtual Exit Point means a commercial exit point of gas from the transmission system without a defined physical location. Virtual Entry Point means a commercial entry point of gas to the transmission system without a defined physical location. Virtual Trading Point means a point without a defined physical location in the transmission system where trade in natural gas is carried out Abbreviations used in the Access Rules: Abbreviations and acronyms: GMS: gas-metering station; GDS: gas distribution station; ETSS: electronic transmission system service booking and administration system (electronic transmission service system); 9

10 MHQ: the maximum hourly gas quantity; P: day P (P-1, P +1, and so on, means days that go before or after the day P); TSO: Transmission System Operator; LNGT: Liquefied Natural Gas Terminal; DSO: Distribution System Operator; NCCPE or Commission: the National Control Commission for Prices and Energy Units of measurement: Bar: gas pressure system unit; kwh: kilowatt-hour (unit of energy of gas) calculated according to the gross calorific value; m 3 : cubic meter of gas (gas volume unit) under normal conditions set out in the Access Rules; o C: temperature unit expressed in degrees Celsius Other definitions used in the Access Rules shall be construed as defined by the Law on Natural Gas of the Republic of Lithuania, Balancing Rules and other legislation regulating the natural gas sector Definitions formulated in the Access Rules such as "no less than n working days before the commencement of the period for which the capacity is booked, at least n days before the commencement of the period of use of capacity must be understood as definitions that by the commencement of transmission or use of capacity must remain a number of complete n working days. Let s suppose that in the event of the provision that "bookings are accepted no later than 3 business days prior to the commencement of the period for which the capacity is booked, and if the commencement period (P) is Friday, bookings must be placed no later than on Monday (P-4), if the commencement of the period (P) is Thursday, bookings must be submitted no later than on Friday (P-6) If the operations associated with the booking and administration of the transmission services are carried through the ETSS, the time limits provided in these Access Rules shall be recorded without distinction of work and rest days; if the said operations are conducted in writing (by e- mail, fax, telephone or regular mail) time limits shall be expressed in the Access Rules in working days. 10

11 3. RIGHTS AND OBLIGATIONS OF THE TSO AND SYSTEM USERS 3.1. Rights and obligations of the TSO and System Users: The TSO shall have the right: to set out the Access Rules; to set out the Balancing Rules; to require the System Users to carry out the provisions of the Access Rules and of the Balancing Rules; to refuse to grant access to the transmission system and to restrict or stop the transmission of gas in the procedure set out in section 18 of the Access Rules and in legislation; to require System Users to pay for the transmission services provided in the procedure set out in the Access Rules; to use other rights granted by the TSO defined in legislation, the Access Rules and Balancing Rules The TSO shall have the obligations: to ensure reliable operation of the transmission system, and the efficient and safe transmission of gas; to provide the right to make use of the transmission system for all System Users under the conditions laid down in the Access Rules and legislation; to ensure the transmission of gas to the System Users to the gas delivery location; to transmit gas in the procedure set out in the Access Rules; to provide System Users with the relevant and timely information related to the transmission services in the procedure set out in the Access Rules and Balancing Rules; to perform the transmission system balancing in accordance with the procedure set out in the Balancing Rules; to perform other responsibilities of the TSO specified in the provisions of the Access Rules, Balancing Rules and legislation The System User shall have the right: to make use of the transmission system in the procedure set out in the Access Rules; to obtain necessary information relating to the transmission services and other information, which the TSO has to provide to System Users according to the responsibilities specified in the Access Rules, in the procedure set out in the Access Rules; to receive invoices for the transmission services provided to them in the procedure set out in the Access Rules; to require the TSO to perform its duties set out in the Access Rules, Balancing Rules and legislation; 11

12 to use other rights granted to the System Users set out in other legislation, the Access Rules, and Balancing Rules The System User shall have obligations: to comply with the provisions of the Access Rules and Balancing Rules; to deliver natural gas to the TSO to the Receipt Location and receive gas from the TSO at the Delivery Location; to pay for the transmission services provided in accordance with the procedure set out in the Access Rules; to provide the TSO with the required information related to the transmission services in accordance with the procedure set out in the Access Rules and Balancing Rules; to perform other obligations assigned to the System Users and specified in the provisions of the Access Rules, Balancing Rules and legislation. 12

13 4. COOPERATION BETWEEN THE TSO AND OTHER GAS SYSTEM OPERATORS 4.1. The TSO shall cooperate with other gas system operators by exchanging the necessary technical and commercial information with them Guidelines for the cooperation between the TSO and other gas system operators, the extent of the provision of information, frequency and other relevant conditions shall be provided for in the cooperation contracts concluded between the TSO and other gas systems operators under the specified terms and conditions The Cooperation Contracts with the DSO may not be concluded if gas transmitted to the distribution system is not supplied to other System Users or the DSO Cooperation Contracts shall include the following: matching procedures, if applicable; how gas metering is carried out; what are the requirements at the interconnection point of gas pressure systems; what are the rules for natural gas allocation at the interconnection points of the systems (in the case of the Cooperation Contract between an adjacent Transmission System Operator or the LNGT operator); how the exchange of information, which is necessary for the provision of licensed services, is carried out; actions in the event of accidents and failures; other provisions provided for in legislation and necessary to ensure proper cooperation of operators. 13

14 5. TRANSMISSION SYSTEM 5.1. TSO-managed transmission system shall consists of: main pipelines; gas Compressor Stations (GCS); gas Metering Stations (GMS) at the cross-border connections; gas Distribution Stations (GDS) or the interconnection points of GMS with the distribution systems or consumers systems directly connected to the transmission system; pipeline corrosion protection equipment; data transmission and communication systems Maximum operating pressure of the transmission system: 54 bar Entry points of the transmission system: interconnection point of transmission systems of Lithuania and Belarus. Gas metering point: Kotlovka GMS; interconnection point of transmission systems of Lithuania and Latvia. Gas metering point: Kiemenai GMS; Interconnection point of the transmission system with the LNGT system Exit points of the transmission system: interconnection points of the transmission system with the distribution systems. Gas metering point: GDS or GMS behind which the distribution system commences; interconnection points of the transmission system with the consumers systems directly connected to the transmission system. Gas metering point: GDS behind which the consumer s system commences; interconnection point of transmission systems of Lithuania and Latvia. Gas metering point: Kiemenai GMS; Interconnection point of transmission systems of Lithuania and Kaliningrad region of the Russian Federation. Gas metering point: Sakiai GMS While conducting trade in gas existing in the transmission systems, gas shall be injected at the Virtual Entry Point and off-taken at the Virtual Exit Point Gas shall be traded on the Virtual Trading Point under the purchase and sale agreements, on the Exchange and / or in other ways. Gas, which is injected at the Entry Point, but still has not been ejected from the Exit Point, shall be traded on the Virtual Trading Point The operator of the Exchange and / or a supply company shall provide information to the Transmission System Operator on the quantities of gas sold and / or purchased on the Virtual Trading Point. 14

15 6. TRANSMISSION CONTRACT AND THE PROCEDURE FOR ITS CONCLUSION 6.1. The potential user of the transmission system in order to be entitled to make use of the transmission system operated by AB Amber Grid and of the gas transmission services must to conclude a Transmission Contract with the TSO After the conclusion of the Transmission Contract, the applicant shall become a System User and shall be entitled to book capacity, transport gas through the transmission system and perform other actions related to the use of services provided by the Transmission System Operator The potential user of the transmission system in order to conclude a Transmission Contract shall submit a request for conclusion of a Transmission Contract providing the necessary information and documents as set out in paragraph The TSO, upon receipt of a request for a Transmission Contract, shall have the right to require a potential user of the transmission system to provide the last (most recent) financial reports and other relevant information to determine the financial position of the potential transmission System User and to decide on the reliability of the creditworthiness of the potential user of the transmission system in assessing financial results, sustainability, liquidity, profitability and debt ratios of that potential System User, and if this is not enough - other financial data. In the event of high risk for the solvency of the potential user of the transmission system, the TSO shall have the right to require submitting a measure securing the fulfilment of obligations The TSO, having identified the changed (increased) risk of the solvency of the System User during the Transmission Contract, and / or based on the opinion of the TSO that the contractual commitments cannot be met, shall have the right to require submitting security measures for the fulfilment of obligations The Energy Identification Code (EIC) granted to the System User may be indicated at the time of entering into a Transmission Contract The System User, when submitting the request for a Transmission Contract in the form provided on the TSO website, thereby also agrees to conclude a contract to use the ETSS. By concluding the contract to use the ETSS, the System User shall be granted an identification code and password for use the ETSS The procedure for submitting a request for a Transmission Contract: A request for a Transmission Contract along with the documents specified in paragraph shall be submitted to the TSO in writing (by facsimile, registered mail, courier or e- mail) in accordance with the request form published on the TSO website By submitting a request for a Transmission Contract the following data and documents must be provided: addresses and details of the entity submitting the request (name, entity code, VAT number, address, phone number, fax, address, website address, bank details); contact details of the representative (s) of the entity having the right to assume obligations on behalf of the entity (including full name, title, phone number, fax 15

16 number, address), and documents proving such authorisation in case the Transmission Contract is concluded not by the head of the company; contact data ( address and phone number). The TSO shall have the right to contact on matters related to the provision of transmission services 24 hours a day The TSO may request the applicant to submit additional documents necessary for the conclusion of the Transmission Contract The request together with the documents referred to must be submitted to the TSO no later than 2 months before booking capacity for the first time in accordance with the procedure set out in section After the submission of the request in case of changes in the data or documents of the applicant, the applicant within a reasonable period, but no longer than within 3 working days, shall notify the TSO thereof The procedure for the examination of the request and decision making: The TSO, upon receipt of the request for a Transmission Contract, shall assess data and documents specified in the request (their adequacy, validity, accuracy), consider the request and within 14 calendar days from receipt of the request: offer to conclude a Transmission Contract; or request to specify / supplement the information or documents referred to in the request by providing explanations and justification for such a request; after the identification of risks, shall request the potential users of the transmission system to provide the latest financial statements; request to submit security measures for the fulfilment of obligations if the System User does not have a long-term foreign currency credit rating which is equal or higher than Baa1 according to Moody's agency, or BBB+ - according to Standard & Poor's agency, or BBB+ - according to Fitch Ratings agency, or there are any other circumstances (signs of insolvency in respect of other suppliers, other factors leading to financial risks), which reasonably suggest that a System User cannot fulfill its obligations under the contract and / or the Access Rules refuse to grant the request for a Transmission Contract If the TSO request to supplement / clarify data and (or) to prove the reliability of the creditworthiness, the applicant must submit to the TSO the revised / supplemented request and the required documents within seven calendar days of receipt of the request The TSO, after the receipt of a revised request and (or) the required documents, shall notify the applicant about its decision to grant the request to use the transmission system in writing within seven calendar days If the TSO fails to receive the required information and (or) documents (according to paragraphs ) within seven calendar days, the request examination procedure shall be suspended until the System User provides the required (according to paragraphs ) documents. 16

17 In the event of refusal to grant a request to use the transmission system and suspension of the request examination procedure, the TSO shall inform the applicant in writing about the reasons of the decision If the Transmission Contract between the TSO and the applicant fails to be concluded within 2 months of the date of the initial request for a Transmission Contract, a request to make use of the transmission system shall expire If the TSO fails to reply to a request to make use of the transmission system within 14 calendar days or within 7 calendar days after the receipt of additional information, it shall be considered that the request is deemed appropriate Conclusion of a Transmission Contract: The TSO, by submitting a proposal to conclude a Transmission Contract under paragraph , shall send to the applicant by or fax a signed Transmission Contract drawn up in accordance with the Transmission Contract form provided on the TSO website The applicant shall send to the TSO the signed Transmission Contract by or fax within 5 working days of its receipt If the contract drawn up by the TSO contains errors or discrepancies, the applicant shall immediately notify the TSO and the TSO shall revise the Transmission Contract The TSO, upon receipt of the signed contract from the applicant by or fax, within 5 working days of receipt of the signed contract, shall send two copies of the original signed Transmission Contract to the applicant by registered mail The applicant shall send to the TSO the original signed Transmission Contract (one copy) by registered letter within 5 working days of its receipt If the applicant fails to send the signed contract within the time specified in paragraph , the request for the Transmission Contract shall be deemed rejected and the TSO shall forthwith inform the applicant and the Commission in the manner provided for in paragraph Grounds and procedure of refusal to grant the right to use the transmission system: In the event of refusal of a request to use the transmission system or to sign the Transmission Contract, the TSO shall within 10 working days inform the Commission about its decision and reasons The TSO shall be entitled to refuse to grant the right to use the transmission system because of the following reasons: the request does not contain all the required information, or it turns out to be false; the deadline for submission of requests laid down in paragraph of the Access Rules is missed; there are no technical possibilities for transmission services; the person who submitted the request failed to pay for transmission services previously provided, if they have been provided; the consumer's gas system connected to the transmission system fails to meet technical requirements set out in legislation; 17

18 in other cases stipulated by legal acts Transmission Contract: The Transmission Contract shall enter into force upon signature by both parties The Transmission Contract shall be concluded for an indefinite period The Access Rules shall form an integral part of the Transmission Contract The Transmission Contract shall contain the following information: parties to the contract and their particulars; the object of the contract; the procedure and conditions of transmission; service pricing and request procedures; settlement procedure; obligations of the parties: rights and duties; gas accounting/metering; gas quality; gas transmission restriction or interruption conditions; dispute settlement procedure; conditions of amendment and termination of the contract; procedure for the submission of information on the transmission services; transmission system balancing procedure The Parties to the Transmission Contract shall immediately, but no later than within 3 working days, inform each other in writing of the change in legal status, name, address or other particulars The Transmission Contract may be terminated: upon agreement between the parties to the Transmission Contract; If one party, wishing to terminate unilaterally the Transmission Contract, gives a 10 days prior notice to the other party on the termination of the Transmission Contract in the event that party fails to comply with or improperly executes the Transmission Contract, and it is the essential breach of the Transmission Contract on the grounds provided for in Article of the Civil Code of the Republic of Lithuania Planning of natural gas quantities transmitted: The System User must specify (declare) in the ETSS, on a quarterly basis during the contract period, the scheduled monthly quantities of gas to be delivered to the transmission system and (or) off-taken from the transmission system for each delivery and receipt location, for the next four quarters ahead or a shorter period if the Transmission System Operator is planning to use the transmission system for less than one year Quantities of gas planned to be delivered to the transmission system and (or) off-taken from the transmission system, changes in gas quantities must be executed no later than 10 18

19 calendar days prior to the beginning of each quarter by providing them to the ETSS or by presenting them in writing no later than 15 calendar days before the beginning of each quarter At the TSO's request, the System User must provide the planned quantities of gas to be delivered to the transmission system and (or) off-taken from the transmission system for the next period (other than specified in paragraph ) requested by the TSO. 19

20 7. CAPACITY ALLOCATION 7.1. Capacity allocation for System Users that have entered into a Transmission Contract with the TSO shall be provided in the procedure described in this section Capacity allocation mechanism set out in the Access Rules shall apply at all entry and exit points Capacity at the entry points and exit points shall be allocated separately and not linked System Users shall be entitled to acquire both entry and exit capacity System Users, which deliver gas to the transmission system, must purchase entry capacity at the entry points. System Users wishing to transport gas to the distribution system, other transmission systems or to the users' systems directly connected to the transmission system must purchase exit capacity Transmission services and capacity products: The TSO offers long-term, short-term and interruptible services at all entry and exit points of the system. That is, a long-term capacity from 1-year inclusive, and short-term capacity of up to 1-year, firm (not exceeding technical capacity) and interruptible capacity The TSO offers the following standard capacity products at all entry and exit points: Yearly; Quarterly; Monthly; Daily; Within-day If the TSO identifies the need for longer-term capacity, the TSO can offer longer-term capacity products (2-years, and so on) by informing all System Users and ETSS and by announcing allocation time limits of the specific term capacity The proposed capacity shall be expressed in units of energy per unit of time - MWh / day General provisions for the allocation of capacity: If the start time of use of capacities coincides, the long-term capacity the beginning of use of which is the beginning of the gas year shall be allocated first. After the allocation of the long-term capacity, short-term capacity shall be allocated If during the allocation of the certain term firm capacity, the demand for capacity exceeds the supply (the demand for capacity is greater than available technical capacity), the TSO shall propose to the System Users interruptible capacity of this term The TSO, having established the need for interruption of interruptible capacity, shall carry out the interruption of capacity to the System Users to the extent that is necessary to ensure firm capacity by applying the principle of pro-rata or first-come, first-served, therefore: if Interruptible Capacity bookings have been submitted during the booking period determined (in accordance with paragraphs 7.10 and 7.11), the interruption of 20

21 interruptible capacity shall be carried out by applying the principle of pro rata, i.e. the interruptible capacity for a particular System User at the particular entry or exit point shall be reduced by the quantity equal to the ratio between the quantity of interruptible capacity booked at that point by that particular System User and the quantities of interruptible capacity ordered by all System Users at that point, multiplied by the quantity of interruptible capacity required to be interrupted as established by the TSO; the interruption of those bookings that were placed later (including bookings for capacity specified in paragraph ) shall be carried out on the first-come, firstserved principle, i.e. the interruption of interruptible capacity shall be executed in the sequence when the interruptible capacity services were booked and the interruption shall be primarily carried out for the System Users that have booked interruptible capacity at the latest; if at the end of the booking period set, two or more System Users booked interruptible capacity at the same time, the interruption of capacity shall be carried out for these System Users by applying the above principle of pro-rata Demand for new capacity: In the event of demand for new capacity, the creation of which requires investment in the transmission system, they shall be classified using the Open Season Procedure The procedure referred to in paragraph shall not apply in cases where the capacity is created for new users or gas systems to be connected. In such a situation, the capacity shall be created and allocated in accordance with the procedure laid down by law Capacity booking methods and general principles: Capacity can be booked and confirmed: online, using the ETSS, when the System Users so that to use the ETSS must conclude a contract to use the system and get their ID and password; or in writing, using the booking forms provided on the TSO website In case of interruption of the ETSS operation, the TSO shall immediately inform System Users about the interruptions, and all the procedures shall be performed in writing (by e- mail or fax) until the disturbances in ETSS are resolved System Users shall book capacity in accordance with the following principles: capacity bookings must be made only during the set booking period (in accordance with paragraphs 7.10 and 7.11); capacity bookings must be provided according to each entry and exit point; a request to acquire only a single-term (or consecutive days) capacity may be presented for each capacity booking; if after the capacity booking, the System User receives information from the TSO that the amount of capacity booked can be confirmed only partially or not at all confirmed, and interruptible capacity is offered to him, the System User within the time limits set out in paragraphs , Error! Reference source not found., Error! 21

22 Reference source not found., must notify the TSO whether agrees to reserve the interruptible capacity or not In the event of a manual capacity booking, the TSO shall assess only the time when the booking form was received, but not sent Long-term capacity booking and confirmation deadlines, the principle of allocation: Long-term bookings must be submitted to and confirmed according to the following deadlines: long-term bookings shall be accepted online no later than 20 calendar days before the commencement of use of capacity, and no earlier than 6 months before the commencement of the period of use of capacity; manual long-term bookings shall be accepted no more than 6 months before the commencement of the period of use of capacity and not later than 3 working days before the latest booking period as indicated in paragraph ; the TSO, in the shortest possible time, but no later than the following working day after the last date of submission of bookings, at 16:30 h, shall inform the System User about the firm capacity (allocated) granted to him and if the quantity of capacity booked is not fully confirmed, the TSO shall offer interruptible capacity; when interruptible capacity is offered to the System User, the System User shall within 5 working days send to the TSO the approval (via ETSS and or fax) whether he agrees to book interruptible capacity. If the System User fails to send the confirmation within 5 working days, only allocated firm capacity shall be allocated to the System User If the demand for long-term capacity exceeds technical capacity, the long-term capacity shall be allocated using the pro rata principle. That is, when available technical capacity is insufficient to meet the needs of the System Users, capacity for a particular System User shall be allocated in proportion to the quantity of capacity requested by the System Users. Therefore, the quantity of capacity allocated to the System User shall be equal to the ratio between the quantity of capacity booked at that point by that System User and the total quantity of capacity booked at that point by all System Users, multiplied by the quantity of capacity available with the TSO. Capacities booked for the DSO technological needs at the interconnection points with distribution systems shall not be reduced Quarterly, monthly, daily and within-day capacity booking and confirmation deadlines, and the principles of their allocation: Quarterly, monthly, and daily capacity bookings must be submitted according to the following deadlines: quarterly online capacity bookings and quarterly manual capacity bookings shall be accepted no later than 5 calendar days before the commencement of use of quarterly capacity, and no earlier than 15 calendar days before the commencement of the period of use of quarterly capacity; monthly online capacity bookings and monthly manual capacity bookings shall be accepted no later than 5 calendar days before the commencement of use of 22

23 monthly capacity, and no earlier than 15 calendar days before the commencement of the period of use of monthly capacity; daily online capacity booking shall be accepted no later than by 13:00 h of the day preceding the gas day on which the period of use of capacity commences, and no earlier than 14 calendar days prior to the commencement of the gas day for which capacities are booked. Daily manual capacity bookings shall be accepted no later than 3 working days before the commencement of the period for which the capacity is booked, and no earlier than 14 calendar days before the commencement of that period Quarterly, monthly, and daily capacity bookings shall must be confirmed in accordance with the deadlines specified in paragraphs The TSO shall inform the System User about the capacity quantities allocated in accordance with paragraphs and via the ETSS and no later than the next working day after receipt of the capacity booking before 16:30 h. All capacity bookings received during the capacity booking period shall be summed up. If the request cannot be fully granted and interruptible capacity is offered, the System User shall, in the shortest possible time, but no later than the following working day at 16:30 h, after the day of the offer to purchase interruptible capacity, send a confirmation to the TSO whether he agrees to reserve interruptible capacity. If the System User fails to send the said confirmation by the deadline set, only allocated firm capacity shall be allocated to the System User The TSO shall inform the System User about the daily capacity quantity to be allocated in accordance with paragraph no later than 1 hour after the capacity booking, if the booking is received through the ETSS, and no later than the next working day after the capacity booking made in writing. If the request cannot be fully granted and interruptible capacity is offered, the System User shall, in the shortest possible time but not later than 15:00 h of the day preceding the gas day on which the period of use of capacity commences, in case the capacity is booked through ETSS, and no later than the nearest working day at 16:30 h, following the date of the offer to purchase interruptible capacity, in the event of manual capacity booking, send to the TSO a confirmation whether he agrees to reserve interruptible capacity. If the System User fails to send the said confirmation by the deadline set, only allocated firm capacity shall be allocated to the System User The within-day capacity shall be booked and confirmed through the nomination submission and confirmation procedure described in section 10 by booking additional daily capacity Quarterly, monthly and daily capacities shall be allocated on the first-come, first-served principle. That is, capacities shall be primarily allocated for the System Users that have booked capacity at the earliest By applying the first come, first served principle, all bookings received on the same gas day during the booking period of the certain term capacities (in accordance with paragraphs ) shall be are treated as bookings received on the same time. 23